VANCOUVER, BRITISH COLUMBIA--(Marketwire - June 29, 2011) - Andean American Gold Corp. (TSX VENTURE:AAG)(FRANKFURT:AQN) ("Andean" or the "Company") reports that for the three months ended March 31, 2011, it incurred a net loss of $8,631,923 or $0.08 per share compared to a loss of $1,230,701 or $0.01 for the same period in 2010. For the twelve months ended March 31, 2011 the Company reports that it incurred a net loss of $12,118,803 or $0.11 per share compared to a loss of $691,552 or $0.01 per share for the same period in 2010. Andean ended the year with cash on hand of $25,404,433 and a working capital surplus of $22,262,962.

About Andean American

Andean is an international mining and Exploration Company focused on value growth through the development of gold and copper projects in Peru and currently has two key assets: the 31,600 hectare Invicta gold-silver-copper advanced exploration stage project located in the Huaura Province in Peru, and 59.8% of Sinchao Metals Corp., owner of the Sinchao zinc-copper-silver-gold-lead exploration project. In addition, the Company is actively targeting early stage gold and silver prospects in Peru and elsewhere in South America (or elsewhere in the region).

COMPANY HIGHLIGHTS

CORPORATE



--  In May and June 2010, the Company announced the appointment of three
    senior Executives: David Rae (President), Bruce Ramsden (Chief Financial
    Officer and Vice President Finance), and Mark Zabel (Vice President
    Corporate Development). Concurrently, the company opened an office in
    Toronto.

--  On July 30, 2010, the Company completed a non-brokered private placement
    for 6,923,682 common shares at $0.50 per share for gross proceeds of
    $3,461,840.

--  On November 12, 2010, the Company completed a brokered private placement
    for 18,169,000 common shares at $0.90 per share for gross proceeds of
    $16,352,100. The underwriters were paid a 5% cash fee on the gross
    proceeds of the offering and received 908,450 warrants or 5% of the
    shares sold under the offering. The warrants will be exercisable at a
    price of $1.25 per common share for a period of 12 months.

--  In November 2010, the Company announced that John Huguet would be
    stepping down as Chairman and Chief Executive Officer of the Company,
    effective December 31, 2010, and David Rae would be appointed Chief
    Executive Officer, President and Director, effective January 1, 2011.
    Also effective January 1, 2011, Paulo Bilezikjian, a Director of the
    Company assumed the role of Chairman and Mario Caron was appointed to
    the board. On January 13, 2011 and March 1, 2011 Nick Demare and Shafiq
    Gulamani respectively resigned from the board. John Huguet is no longer
    involved in the affairs of the Company.

--  On January 31, 2011, Trafigura Beheer B.V. exercised their option, which
    was previously announced on March 31, 2010, to acquire an additional 16%
    of the outstanding common shares of the Company. This was effected on
    February 16, 2011 when the Company completed its non-brokered private-
    placement with Urion Mining International B.V. of Amsterdam,
    Netherlands, a wholly-owned subsidiary of Trafigura Beheer B.V, for
    19,574,605 common shares at $0.77 per share for gross proceeds of
    $15,072,445.

--  On February 3, 2011, the Company announced that the agreement with
    Barclays Capital, the investment banking division of Barclays Bank PLC
    ("Barclays Capital") and WestLB AG, New York Branch ("WestLB"), as
    previously announced on February 17, 2010, had been renewed for a
    further period of 12 months until February 10, 2012. Barclays Capital
    and WestLB will act as the Joint Lead Arrangers for a senior debt
    financing (the "Facility") of up to US$68 million for the construction
    and start-up of production at the Company's wholly-owned poly-metallic
    Invicta Project in Peru.

LOCAL COMMUNITIES

--  On March 1, 2011, the Company announced that significant progress had
    been made towards the completion of Surface Land Use agreements with the
    three primary communities surrounding the Invicta Project, and that the
    first of these agreements had been signed with the community of Santo
    Domingo de Apache. The Company previously expected that the second
    agreement would be signed during March 2011 and the final agreement by
    mid-year, however it is likely that both will be signed during the third
    quarter, and only then can phase one construction of the site
    infrastructure begin.

--  On April 20, 2011, Andean announced that agreements for long-term land
    lease and concurrent commitments for ongoing social development had been
    signed with the communities of Quintay and Sayan. These relatively small
    parcels of land cover ground required for the development of
    infrastructure at Invicta.

--  During the year the Company contributed actively to environmental
    programs and socio-economic development in the surrounding communities.
    Specifically:

    --  In the Santo Domingo de Apache community, Andean and a large group
        of community members planted 30,000 pine trees on 38 hectares of
        land. This plantation will bring multiple benefits to the community.
    --  Also in Santo Domingo de Apache two pilot programs were launched in
        March 2011 for irrigation to support the cultivation of peaches and
        blueberries.
    --  Andean has upgraded, and is maintaining, 12 km of canals providing
        water to the local communities.
    --  The Company is currently conducting a technical study for the
        irrigation of 220 hectares of agricultural land in the community of
        Sayan.
    --  The Company has hosted the local communities on numerous educational
        visits to the project site and to other Peruvian mining regions.

THE INVICTA PROJECT

--  In September 2010, Andean commissioned SRK Consulting (U.S.) Inc.
    ("SRK") to conduct an independent gap analysis on the Invicta optimized
    Feasibility Study ("OFS") which had been completed in July 2010, to a
    Feasibility Study that would be acceptable to Senior Project Lenders.
    The completion date for this upgraded study was originally targeted for
    June 2011. The in-depth work conducted by SRK, incorporating preliminary
    estimates from other project consultants, indicates certain increases in
    the original capital costs forecast in the July 2010 study, especially
    in the area of roads, water, power and other infrastructure, which
    accounts for approximately one third of the preliminary initial capital
    cost estimate. The management of Andean has asked SRK, and the partner
    consultants working on the project, to conduct further work,
    specifically trade-off studies, to determine where capital costs can be
    reduced. Examples of trade-offs include the relocation of the plant and
    tailings dam to reduce duplicated infrastructure, and the use of an
    aerial cableway transportation system to move ore, people and
    consumables to reduce the number of kilometres of road development.
    Management has allowed a further seven months for completion of the
    upgraded Feasibility Study.

--  Once SRK completes the upgrade of the OFS, and once agreements with the
    all the key communities have been signed, the Company anticipates
    securing funding of up to US$68 million in a Senior Secured Project
    Finance Facility, through Barclays Bank and WestLB AG, which will be
    used for the construction and development of the Invicta Project. The
    reader should note that the Project Finance Facility is subject to the
    project economics, which will only be known on the completion of the
    upgraded Feasibility Sudy as mentioned above.

Results of Operations
---------------------------------------------------------------------------
                           Three        Three          Twelve        Twelve
                          months       months          months        months
                           ended        ended           ended         ended
                        March 31     March 31        March 31      March 31
---------------------------------------------------------------------------
                            2011         2010            2011          2010
---------------------------------------------------------------------------
Income/(loss)
 before income tax   ($8,631,923) ($1,230,701)   ($12,118,803)    ($691,552)
---------------------------------------------------------------------------
Income/ (loss) per
 share                    ($0.08)      ($0.02)         ($0.11)       ($0.01)
---------------------------------------------------------------------------
Total assets                                      $67,767,522   $49,604,359
---------------------------------------------------------------------------
Working capital
 surplus/ (deficit)                               $22,264,962   ($2,598,914)
---------------------------------------------------------------------------
Mineral properties                                $40,186,655   $44,562,692
---------------------------------------------------------------------------
Share Capital:
---------------------------------------------------------------------------
Outstanding                                     143,295,892(4) 94,570,693(1)
---------------------------------------------------------------------------
Warrants                                            5,589,368   7,711,645(2)
---------------------------------------------------------------------------
Options                                        6,127,588(4)(5)  7,093,500(3)
---------------------------------------------------------------------------

1.  During July 2010, 6,923,682 common shares were issued by way of a
    private placement at $0.50 per common share.
2.  Subsequent to year end March 31, 2010, 2,272,727 warrants expired.
3.  Subsequent to year end March 31, 2010, 1,850,000 stock options were
    issued to directors, officers and consultants of the Company.
4..  During April 2011, 200,000 stock options at $0.71 and 30,000 at $0.40
    were exercised and during May 2011, 50,000 stock options $0.30 were
    exercised, and during June 2011, 300,000 stock options $0.30 were
    exercised.
5.  Subsequent to year end March 31, 2011, 1,700,000 stock options expired.

Cash Flow and Liquidity

As at March 31, 2010 the Company had a working capital surplus of $22,264,962, compared to a working capital deficit of $2,598,914 at March 31, 2010. For the twelve months ended March 31, 2011, Andean generated cash of $35,476,664 through proceeds from a private placement and the exercise of options and warrants. This was offset by cash used in operating activities of $4,763,478, cash used in investing activities of $6,375,778 and loans repaid in financing activities of $1,647,383. Most of the cash used in investing activities was used to advance the Invicta Project.

During the twelve months ended March 31, 2011, the Company issued 44,667,287 common shares through private placements for cash proceeds of $34,886,387. Share issue costs totaled $988,656. For the same period 758,000 warrants were exercised for cash proceeds of $310,300 and for the same period 2,719,912 stock options were exercised for cash proceeds of $1,258,361.

The information above should be reviewed in conjunction with the Company's unaudited consolidated financial statements, management discussion and analysis, for the three and twelve months ended March 31, 2011 that will be available shortly on www.sedar.com. For further information call (604) 681-6186 or toll free: 1-888-356-4784 or visit our website at www.AAGgold.com.

On behalf of Andean American Gold Corp.,

Bruce Ramsden, Vice President, Finance and CFO

This news release may contain forward-looking information within the meaning of the Securities Act (Ontario) ("forward-looking statements"). Such forward-looking statements may include the Company's plans for its mineral projects, the overall economic potential of its properties, the availability of adequate financing and involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements expressed or implied by such forward-looking statements to be materially different. Such factors include, among others, risks and uncertainties relating to potential political risks involving the Company's operations in a foreign jurisdiction, uncertainty of production and costs estimates and the potential for unexpected costs and expenses, physical risks inherent in mining operations, currency fluctuations, fluctuations in the price of gold and other metals, completion of economic evaluations, changes in project parameters as plans continue to be refined, the inability or failure to obtain adequate financing on a timely basis, and other risks and uncertainties, including those described in the Company's Financial Statements, Management Discussion and Analysis and Material Change Reports filed with the Canadian Securities Administrators and available at www.sedar.com.

This press release is not an offer to sell or the solicitation of an offer to buy the securities, nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to qualification or registration under the securities laws of such jurisdiction. The securities being offered have not been, nor will they be, registered under the United States Securities Act of 1933, as amended and such securities may not be offered or sold within the United States absent an applicable exemption from U.S. registration requirements.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

FOR FURTHER INFORMATION PLEASE CONTACT:
        Andean American Gold Corp.
        Bruce Ramsden
        Vice President, Finance and CFO
        416-368-9500
        bramsden@aaggold.com
        www.aaggold.com

Source: Andean American Gold Corp.